That’s an exaggeration, but Sam Katz who heads the state board overseeing the city of Philadelphia’s finances said he wants to get serious about fixing the city’s long term fiscal problems, and selling city assets may be part of the mix.
The board, the Pennsylvania Intergovernmental Cooperation Authority approved the budget and five-year financial plan Mayor Nutter and City Council approved, but Katz said he wants to assemble the key players in the city finances in the coming months and take on some its most vexing issues, especially pension costs.
It’s no secret the city pension fund is gravely under-funded and Nutter wants to push employees into less costly plans in the future. Katz said he expects that will be part of the solution, but he wants to look for other ideas.
When reporters asked for an example, Katz said, “Divestiture of assets. We might have to sell something.”
To be meaningful, the city would have to sell something pretty valuable. Old clothes and books aren’t going to get much. When reporters asked what the city might sell, Katz said he doesn’t have a list, but that anything the city owns that doesn’t fulfill a core city function is worth considering.
“I would say airports,” Katz offered. “You know, we need an airport, but it doesn’t necessarily have to be delivered by a municipality. In fact, for the most part airline services are delivered by airlines. So you know, there are candidates (for sale). There are not a lot of candidates, but there are candidates.”
Folks have talked about selling the airport and the city-owned gas works for nearly as long as I’ve covered city government, which is a long time. Most efforts have lost steam because both the gas works and the airport turn out to have really complicated legal and financial structures with lots of debt, and it gets hard to figure out how you realize a couple hundred million and still ensure that key functions will be performed. Maybe this time will be different.
But hearing Katz talk gave me a bit of deja vu. When the city was going broke in 1989 and 1990, Katz was a founding principal in Public Financial Management, one of the country’s leading financial advisors to cities and states.
Katz made a name (and the beginnings of a political career) for himself by holding forums and speaking out on the city’s financial problems. He also ticked then-Mayor Wilson Goode off, who called him “a worm.”
It’s now 20-odd years later and Katz has run three times for mayor, an office it’s doubtful he’ll ever attain. But he means to have an impact in the city, and I expect he will.
UPDATE: PICA has issued athe following statement :”The opinions expressed by Mr. Katz represented his views and do not reflect the views of the PICA Board. The PICA Board has not discussed, deliberated, or made any recommendations regarding the sale of City assets.”